Smart watch shipments to surpass 5 million units next year

According to Canalys’ figures, the worldwide smart watch market will exceed 5 million unit shipments next year. The research firm estimates that more than 330,000 smart watches were shipped in 2012, with Sony and Motorola leading the pack. Kickstarter-backed Pebble Technology has joined Sony as a market leader in 2013, and the new forecast now predicts over 500,000 units to be shipped this year.

However, we’ll have to wait for another year to see the real boom, when major companies like Apple, Google, Microsoft and Samsung will join this still nascent market.

Unlike earlier products, the new generation of smart watches provides more sophisticated software and more elegant hardware, featuring glanceable information, integration across sensors and hooks into web services. In other words, these companion devices will not replace smartphones, but rather complement them as so called “appcessories.”

Hardware design will be especially important for these kind of devices as consumers will only want to wear fashionable products. The market for traditional watches will quickly be disrupted once consumers determine that smart watches add sufficiently valuable functionality to their lives while being “stylish enough.”

There are some challenges on the road ahead though, most notably strict power constraints that limit the number of sensors and necessitate communication with smart phones over Bluetooth LE.

Finally, in case you wonder, Canalys defines smart watches as smart wearable bands, which are multi-purpose devices that can run third-party apps and are designed to be worn on the body, and not carried.